The option agreement template you sent us is appropriate if you 
are negotiating with a university. Here we understand this model as follows:

- University grants you an option
- You evaluate technology and let us assume you find it interesting,
  but perhaps not mature enough for the immediate marketplace
- You negotiate actual licensing agreement with the
  university on terms whose guidelines are spelt out in
  the draft you sent us.
- Then, you proceed to set up a company which takes
  over the entire enchilada. you not only install
  business management but also the technical team which
  takes technology to the market. Perhaps the technical team
  involves some students or staff from the University but
  this is incidental
- The original technology creators potentially benefits
  in two ways:
  (1) universiy kicks him/her back some fraction
  of the royalties
  (2) your new company gives him/her consulting contracts, 
  and/or perhaps equity in the new company.
  
Examining draft agreement, we see that we need to initially define what the
option is "for" and then define some details. Below we only address the former
as first we must agree as to what we are "optioning", and then discuss the details.

So the process described above cannot by applied in our case.  SU has already granted an 
EXCLUSIVE license for all multimedia/collaboration technologies developed by NPAC to WebWisdom.com.
SU also does not want us to sublicense this technology. Our contract does 
not strictly forbid it, but in the case we do so, SU will claim 50% of funds obtained
by WebWisdom.com as a sublicense. You also need to be aware that he have forfeited our rights to any
personal receipt of any fraction of the royalties that SU would normally pay to us 
as technology creators. This decision was required by SU's conflict of
interest rules as license was to a company managed by the creators.

These two reasons alone make it unattractive for use to simply sublicense 
the technology but there are several other reasons. 

Currently NPAC is funded to develop Tango/WebWisdomInteractive by NSF and DoD.
A major motivation in setting up WebWisdom.com was to establish an orderly
transition from research to development to product. If product development
did not involve current team, there are no obvious jobs for them at Syracuse
and we would not be able to continue current prototype development.
This would lead to downscoping of NPAC with no new goals. This is clearly
unattractive to us. Even if this only became a factor in a 12 month time-frame,
we do not see how to keep synergy between NPAC and commercial
versions unless WebWisdom.com is driving the development process.

We also believe that complexity of our products and the breadth of our 
technology, as well as the advanced stage of development will make it
very difficult for even the best technical team to productively take over 
the development process.  We would all waste many months.

Finally, we are emotionally  attached to our work which we consider
of high quality, timely and a unique opportunity. It is very unlikely for 
you to be able to present us with financial offer good enough for us to
let somebody else to completely take over.

We do not believe this should be a problem for you but rather an
advantage as you can be guaranteed a highly motivated talented development team.
While we feel we lack skills to set up sound business management for 
WebWisdom.com, we definitely do not need anybody's help in creating a vision
for our products, implementing a development process, and setting
up technical support. 



The model we look for is this of a new business entity in which 
the relevant development process stays within WebWisdom.com/NPAC, and in which
current officers of WebWisdom.com are employed by the new entity on positions 
such as VP/Chief Scientist, VP for Product Development, and CIO. 
Another possible model is that the new entity does business management ONLY, while 
subcontracting entire technical developemnt to WebWisdom.com. In either case, current 
partners in WebWisdom.com obtain (a negotiable fraction of) equity in the new company,
and a spot in Board of Directors. On the other hand, we have no problem with
the new company being run by a CEO, CFO, and a VP for Sales and Marketing found
and installed by you. Also if there are multiple technologies in the new business,
some not associated with us, others can of course develop those not associated with us.

We hope that some variation of the model presented above, is acceptable as a basis for negotiations. 
We are pretty certain that WebWisdom.com and University Ventires are as 
complementary as two gloves - right and left. We have also enjoyed our 
contacts hitherto on the personal level.

Once the basic structure of the option is agreed, then the next important point 
is to define scope of the option agreement. here, the best way for you would be to go to
our (rudimentary) web site and study the document available at

http://www.webwisdom.com/sept1998/wwproduct.html

This is a roadmap for our products which we intend to pursue, no matter what 
our negotiations are going to go. This is also a good start for you to tell 
us what you want to include in the option package negotiations.
Note that this scope is quite important in discussing the nature of option for
we need to make certain that any deal is consistent with our ability to
deliver integrated products described in above URL.